If the Wisconsin governor’s motion goes ahead, it would mean that private insurers would be required for plans.
Governor Scott Walker of Wisconsin has recently proposed a provision that would eliminate the state managed property insurance coverage, and that would require local governments and school districts to have to create their own funds or to look to private insurers if the provision is adopted by the Legislature.
The current fund provides coverage for $52 billion worth of property, with an annual premium of over $27 million.
The insurance coverage that is currently in place provides coverage for everything from the salt sheds to the street sweepers, as well as the horses and dogs of over 970 school districts and municipalities across Wisconsin. By closing down this protection, it would mean that many local governments would be required to turn to private insurance, which would nearly definitely bring about higher costs, said Eric Veum, the risk manager for the city of Madison.
The proposal would bring a complete stop to the insurance coverage that currently exists for those properties.
It would mean that the Local Government Property Insurance Fund would no longer cover the properties that are owned by cities, counties, schools, and a number of other entities. At the moment, the Office of the commissioner of Insurance is responsible for the management of that insurance program.
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The budget currently being proposed by Walker has stated specifically that “no insurance coverage may be issued” through the use of the existing program on or following July 1. Moreover, it pointed out that none of the coverage that is currently in existence will be allowed to be renewed after December 15. At the moment, those dates are considered to be tentative.
The fund has been in existence since 1911, and this proposal has arrived at a time in which that fund has been watching the reduction of its surplus. This is, in part, the result of a decision by the Legislature in 2009, which determined that the surplus was too great, forcing it to provide those paying premiums with a refund of a total of $12 million.